Categories
The Industry

Loving to Hate Our Big ISPs

The American Customer Satisfaction Survey (ACSI) was released earlier this summer that ranks hundreds of companies that provide services for consumers. Historically cable companies and ISPs have fared poorly in these rankings compared to other businesses in the country. The running joke reported in numerous articles about this survey is that people like the IRS more than they like their cable company (and that is still true this year).

But something interesting happened in this year’s survey and the ranking for cable companies collectively improved by 3% and consumer confidence in ISPs climbed 5%. There is no easy way to understand a national satisfaction survey, but those trends are interesting to contemplate.

Let’s start by looking at the numbers. Consumers still rank cable TV providers as the least liked group of companies in the country across all industries, joined at the bottom by ISPs. The ACSI ranks each company and each industry segment on a scale of 1 to 100. The top-rated industries are breweries (84%), personal care and cleaning products (82), soft drinks (82), and food manufacturing (81).

By contrast, cable providers are ranked the lowest at 64 followed closely by ISPs at 65. Joining these companies at the bottom are local governments (65.5), video-on-demand providers (68), and the federal government (68.1).

The overall ranking for cable providers grew from a 62 in 2019 to a 64 in 2020. I can only speculate why people like cable companies a little more this year. This could be due in part to huge growth in cord-cutters who no longer watch traditional cable TV and who might perhaps no longer rate a product they don’t use. Or perhaps folks have come to appreciate the cable product more during the pandemic when people are going out less, and likely watching TV more.

The cable providers at the bottom of the rankings continue to get low satisfaction ratings, with Suddenlink (56), Frontier (58), and Mediacom (60). Just above these companies are two of the largest cable providers – Charter (60) and Cox (61). But all of these companies had a slightly improved satisfaction ranking over 2019. The highest-ranked cable providers continue to be Verizon FiOS (70) and AT&T U-verse (70), now relabeled as AT&T TV.

ISPs didn’t fare much better. It’s worth noting that this list contains many of the same companies on the cable provider list, but consumers are asked to rank cable services separately from broadband services. The overall satisfaction for ISPs grew from a 62 in 2019 to a 65 in 2020. The same three providers are at the bottom – Frontier (55), Suddenlink (57), and Mediacom (59). At the top are the same two providers – Verizon FiOS (73) and AT&T Internet (68).

Part of the explanation of the change in approval ratings for the industries might be little more than statistical variance within the range of sampling. The rankings of individual ISPs vary from year to year. Consider Charter, ranked as an ISP. The company was ranked highest in 2013 and 2017 at a 65 ranking and lowest in 2015 (57) and 2019 (59). This year’s increase might just be variance within the expected range of sampling results.

What matters a lot more is that our cable companies and ISPs are generally consumer’s least favorite companies. This has always benefited smaller ISPs that compete against the big companies. One of the most common forms of advertising for smaller ISPs is, “We are not them”.

People don’t rate cable companies and ISPs so low due because they deliver technical products. Other technology sectors have much higher satisfaction ratings such as landline telephones (70), cellphones (74), computer software (78), internet search engines (76), and social media (70). Consumers are also like electric utilities a lot more than cable companies and ISPs – electric coops (73), and investor-owned and muni electric companies (72).

It’s always been somewhat disheartening to work in an industry that folks love to hate. But I’ve always been comforted by the fact that my smaller ISP and cable clients generally fare extremely well when competing against the big ISPs and cable companies. I have to assume this means people like small ISPs more than the big ones – or perhaps hate them a little less. That’s something every small ISP should periodically consider.

Categories
The Industry

Big ISP Customer Service Still at the Bottom

This time each year we get a peek at how customers view the telecom industry, and for many years running it’s not been a pretty story. The annual American Customer Satisfaction Index (ACSI) was recently published and shows ISPs still ranked at the bottom of all industries in terms of customer satisfaction.

The survey to create the ACSI rankings is huge and involves over 300,000 households and looks at services that households use the most,  considering 400 companies in 46 different industries across 10 economic sectors.

Customers really hate the big cable TV companies and big ISPs. The ACSI index ranks companies on a scale of 1 to 100 and the two lowest ranking industries are Subscription TV Services (62) and Internet Service Providers (62) – both with the same composite ranking as last year. All other industries have rankings in the 70s and 80s, with industries like breweries (85), TV manufacturers (83), soft drinks (82), food companies (82), and automobiles (82) at the top.

The companies ranked just above ISPs have much higher rankings and include the US Postal Service (70), Fixed-Line Telephone Service (71), and Social Media Companies (72).

The big cable companies rank from the low of Altice (55) to a high for AT&T U-Verse (69). The only other companies that rank higher than the industry average of 62 are Verizon FiOS (68), Dish Networks (67) and DirecTV (66). The biggest cable companies fare poorly – Charter (59) and Comcast (57).

Internet Service Providers didn’t fare any better than cable companies with the overall industry ratings at the same 62. The only three ISPs with rankings above the average are Verizon FiOS (70), AT&T Internet (69) and Altice (63). At the bottom of the rankings are Frontier (55), MediaCom (56), and Windstream (57). The big cable companies don’t fare well as ISPs – Charter (59) and Comcast (61).

This continues to be good news for competitive overbuilders that provide good customer service. It’s been obvious over the years that customers hate calling the big cable companies and ISPs because the process of navigating through live customer service is time-consuming and painful.

But these rankings go far deeper than that. At CCG we conduct surveys for our clients who are usually looking at entering a new market. We also interview a lot of telecom customers during the course of a year. The poor opinion of the big providers in our industry runs deep. I see customers that really dislike the process that many of these companies force upon customers who have to negotiate to get lower rates every year or two. People don’t like to find out that they are paying a lot more than their neighbors for the same services. People also dislike service outages which happen far more often than they should. In the last year, we had several headline-grabbing major outages, but more aggravating to customers are the small daily outages that can hit without notice. Households have come to rely on broadband as much as they do for other household necessities like electricity and water, so outages are becoming intolerable.

Competitive ISPs are not automatically better at customer service than the big companies. Some competitive providers also offer too many product options and are willing to negotiate rates with customers. Small ISPs can also fall into the trap of turning every phone call to the company into a sales pitch. Good ISPs are learning to deal with customers in ways tailored to each customer. I know I personally would be thrilled to have my entire ISP relationship be handled by email or text, as long as by doing so I could be assured that I’m getting a good price. Most ISPs still have a long way to go – although I doubt that any ISP is ever going to be liked more than beer!

Categories
Improving Your Business

How’s Your Competition Doing?

A large percentage of my broadband clients compete against some of the biggest ISPs in the nation – either the big telcos, the big cable companies, or both. And so it’s worth taking a look from time to time to see how those big companies rate in terms of comparative customer service. The 2016 ASCI (American Customer Satisfaction Index) was recently released and reveals some of the following things about the biggest players in the telecom space:

The ASCI survey each year talks to 70,000 customers about more than 300 large businesses in 43 industries and 10 economic sectors. The survey gives each company a grade on a scale of 100.

As a sector both ISPs (overall rating 64) and Cable TV companies (overall rating 65) are still the two lowest rated sectors within the overall survey. To put those ratings into perspective there are a number of industry segments at or above a rating of 80 such as full-service restaurants, credit unions, household appliance makers and shipping companies.

ISPs as a whole are up slightly from an overall rating last year of 63 to a rating now of 64. There was a lot of change in positions of the big companies. Verizon FiOS is the highest rated company and went from a 68 rating in 2015 to a rating of 73 this year. At the bottom of the scale is Frontier Communications that fell from 61 last year down to a 56 rating for 2016. The other big gainers were Time Warner Cable (58 to 66), Bright House Networks, (63 to 67) and Charter Communications (57 to 63). The other big loser for the year is AT&T U-verse which dropped from the highest rated in 2015 of 69 to 64 this year.

Cable companies overall improved slightly last year from 63 to 65. But most companies stayed about the same except for moves upward by Comcast (54 to 62), Time Warner Cable (51 to 59) and Suddenlink (57 to 62). Verizon FiOS continues to top the list with a 70 rating with AT&T U-verse just behind at a 69. It will be interesting to see how the Charter / Time Warner Cable / Bright House merger will change these ratings for next year. I’ve read several industry analysts that predict that customer service at those companies will suffer during the transition. As might be imagined, cable customers are pretty happy overall with things like picture quality but the survey showed that they are very unhappy with the call center experience.

Perhaps the most surprising change this year among big companies was the noted improvement of satisfaction for Comcast. Last year they were dead last among cable providers and 2015 saw a rash of negative news articles about customer service fiascos. Comcast says every year that they are taking steps to improve customer service, but perhaps they are finally starting to make some changes that are noticeable to customers.

In the telephone world Vonage leaped to the top of the list moving from 73 to 78. What I find interesting is that everybody else rated between 64 and 72 – not a lot better than the cable companies. I wonder if that rating reflects general dissatisfaction with the telephone product or with these large companies in general.

One thing this survey does every year is to remind us how poorly the general public views the big telcos and cable companies. The industries consistently rate at the bottom for all major industries – far below banks, insurance companies and hospitals.

But these ratings also remind us that it’s possible for these larger companies to get their act together to provide better customer service. I know one of the most dreaded events in our household is having to make a call to Comcast. But the last few times my wife called she said it ‘wasn’t so bad’, and perhaps that explains their improved satisfaction score.

There are certainly new tools and technologies coming to customer service that ought to make customers happier. Companies that provide alternate ways for customers to communicate without having to talk to people are finding that this makes a significant segment of their customers happier. And it looks like we are on the verge of getting some fairly intelligent AI agents to handle routine customer inquiries, and that, sadly, will end the very entertaining news articles about the outrageous things said by Comcast service reps. But it might improve the customer service experience.